1
What is a bank? Explain the primary functions of a commercial bank.
Fundamentals▼A bank is a financial institution licensed to receive deposits and make loans. The primary functions of a commercial bank include:
- Accepting Deposits: Savings, current, and fixed deposit accounts
- Lending: Providing loans, overdrafts, and credit facilities
- Payment Services: Facilitating fund transfers, cheque clearing, and digital payments
- Agency Functions: Collecting bills, paying insurance premiums, and managing investments on behalf of clients
💡 Viva Tip
Mention the Bangladesh Bank Act and the Bank Company Act 1991 (amended 2013) to show legal awareness.
2
What is the difference between a scheduled bank and a non-scheduled bank?
Fundamentals▼Scheduled Bank: Listed in the schedule of Bangladesh Bank, must maintain Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR), eligible for borrowing from the central bank.
Non-Scheduled Bank: Not listed in Bangladesh Bank's schedule, operates under special charter or act (e.g., Grameen Bank operated as non-scheduled initially), has fewer regulatory requirements but limited central bank support.
Non-Scheduled Bank: Not listed in Bangladesh Bank's schedule, operates under special charter or act (e.g., Grameen Bank operated as non-scheduled initially), has fewer regulatory requirements but limited central bank support.
💡 Viva Tip
Know the current number of scheduled banks in Bangladesh (61 as of 2025) and their categories: state-owned, private, foreign, and specialized.
3
Explain CRR and SLR. What are their current rates?
Fundamentals▼CRR (Cash Reserve Ratio): The percentage of total deposits that banks must keep with Bangladesh Bank as cash reserve. Currently 4.0%.
SLR (Statutory Liquidity Ratio): The percentage of net demand and time liabilities that banks must maintain in liquid assets (cash, gold, government securities). Currently 13.0% for conventional banks and 5.5% for Islamic banks.
These are monetary policy tools used by Bangladesh Bank to control money supply and credit creation in the economy.
SLR (Statutory Liquidity Ratio): The percentage of net demand and time liabilities that banks must maintain in liquid assets (cash, gold, government securities). Currently 13.0% for conventional banks and 5.5% for Islamic banks.
These are monetary policy tools used by Bangladesh Bank to control money supply and credit creation in the economy.
💡 Viva Tip
Always check Bangladesh Bank's latest monetary policy statement for updated CRR/SLR rates before your interview.
4
What are the 5 C's of credit analysis?
Credit▼The 5 C's framework evaluates a borrower's creditworthiness:
- Character: Borrower's reputation, integrity, and willingness to repay
- Capacity: Ability to repay — income, cash flows, existing debts
- Capital: Borrower's own investment/equity in the venture
- Collateral: Assets pledged as security for the loan
- Conditions: Economic environment, industry outlook, purpose of loan
💡 Viva Tip
Give a practical example: "When evaluating an SME loan, I would first assess the owner's track record (Character), then review 3 years of cash flow statements (Capacity)…"
5
What is classified loan? Explain the loan classification system in Bangladesh.
Credit▼A classified loan is one where the borrower has failed to make scheduled repayments. Bangladesh Bank classifies loans into:
- Unclassified (UC): Regular — repayment on time
- Special Mention Account (SMA): Overdue 1-2 months — early warning
- Substandard (SS): Overdue 3-6 months — provision 20%
- Doubtful (DF): Overdue 6-12 months — provision 50%
- Bad/Loss (BL): Overdue 12+ months — provision 100%
💡 Viva Tip
Mention the NPL (Non-Performing Loan) ratio and Bangladesh's current banking sector challenges to show awareness.
6
What is the difference between funded and non-funded credit?
Credit▼Funded Credit: Direct disbursement of funds to the borrower. Examples: Term Loan, Overdraft (OD), Cash Credit (CC), Demand Loan, Loan Against Trust Receipt (LTR).
Non-Funded Credit: Bank provides a guarantee or commitment without immediate fund transfer. Examples: Letter of Credit (L/C), Bank Guarantee (BG), Letter of Guarantee (LG). The bank's liability is contingent — funds are disbursed only if the client defaults on the original obligation.
Non-Funded Credit: Bank provides a guarantee or commitment without immediate fund transfer. Examples: Letter of Credit (L/C), Bank Guarantee (BG), Letter of Guarantee (LG). The bank's liability is contingent — funds are disbursed only if the client defaults on the original obligation.
💡 Viva Tip
Explain that non-funded credit generates fee-based income (commission) which improves a bank's non-interest income ratio.
7
What is the role of a Treasury department in a bank?
Treasury▼The Treasury department manages a bank's liquidity, funding, and market risk. Key functions:
- Liquidity Management: Ensuring the bank meets daily cash obligations and regulatory reserve requirements
- Investment: Managing the bank's portfolio — government securities (T-bills, T-bonds), corporate bonds
- Forex Trading: Buying/selling foreign currencies for clients and proprietary positions
- Money Market Operations: Interbank lending/borrowing in the call money market
- ALM (Asset-Liability Management): Matching maturity profiles to minimize interest rate risk
💡 Viva Tip
Know the current Bangladesh Bank repo rate and reverse repo rate, as treasury operations are closely tied to these policy rates.
8
What is the yield curve? Why is it important for banks?
Treasury▼The yield curve is a graphical representation of interest rates on bonds of different maturities (e.g., 3-month to 30-year government bonds).
Types:
Types:
- Normal (upward sloping): Longer maturities = higher yields — indicates economic growth
- Inverted (downward sloping): Short-term rates > long-term — often predicts recession
- Flat: Similar yields across maturities — signals economic uncertainty
💡 Viva Tip
Relate to Bangladesh: discuss how BB's T-bill/T-bond auction results reflect the local yield curve.
9
What is a Letter of Credit (L/C)? Explain its types.
Forex▼A Letter of Credit is a bank guarantee ensuring the seller receives payment upon fulfilling specified documentary conditions. It reduces risk in international trade.
Key Types:
Key Types:
- Sight L/C: Payment upon presentation of compliant documents
- Deferred/Usance L/C: Payment after a specified period (e.g., 90/180 days)
- Revocable L/C: Can be modified/cancelled without beneficiary's consent (rarely used)
- Irrevocable L/C: Cannot be changed without all parties' agreement (standard)
- Back-to-Back L/C: A second L/C opened based on an existing export L/C — common in Bangladesh's garment industry
- Transferable L/C: Beneficiary can transfer credit to another party
💡 Viva Tip
Mention UCPDC 600 (Uniform Customs and Practice for Documentary Credits) — the ICC rules governing L/Cs worldwide.
10
What is the difference between TT, OD, and Buying/Selling rate in forex?
Forex▼TT (Telegraphic Transfer) Rate: The rate for clean (non-documentary) transactions — electronic transfers, demand drafts. TT Buying = bank buys forex, TT Selling = bank sells forex.
OD (On Demand) Rate: Used for documentary transactions involving foreign bills, cheques. Includes a margin for the time taken for realization. OD Buying rate is lower than TT Buying rate because of the waiting period.
Buying Rate: Rate at which bank purchases foreign currency from customer (customer receives BDT).
Selling Rate: Rate at which bank sells foreign currency to customer (customer pays BDT). Selling rate > Buying rate — the spread is the bank's profit.
OD (On Demand) Rate: Used for documentary transactions involving foreign bills, cheques. Includes a margin for the time taken for realization. OD Buying rate is lower than TT Buying rate because of the waiting period.
Buying Rate: Rate at which bank purchases foreign currency from customer (customer receives BDT).
Selling Rate: Rate at which bank sells foreign currency to customer (customer pays BDT). Selling rate > Buying rate — the spread is the bank's profit.
💡 Viva Tip
Know the current USD/BDT exchange rate and mention Bangladesh Bank's recent exchange rate policy changes.
11
What is KYC? Why is it important?
Compliance▼KYC (Know Your Customer) is a regulatory process that requires banks to verify the identity, suitability, and risk of customers before and during the business relationship.
Key Components:
Key Components:
- Customer Identification: Collecting valid ID (NID, passport), photographs, address proof
- Customer Due Diligence (CDD): Understanding the nature of the customer's business and expected transaction patterns
- Enhanced Due Diligence (EDD): Additional scrutiny for high-risk customers (PEPs, non-residents)
- Ongoing Monitoring: Continuous transaction monitoring for suspicious activities
💡 Viva Tip
Reference the Money Laundering Prevention Act 2012 and BFIU (Bangladesh Financial Intelligence Unit) guidelines.
12
What is Basel III? How does it affect banks?
Compliance▼Basel III is an international regulatory framework developed by the Basel Committee on Banking Supervision (BCBS) to strengthen bank capital, liquidity, and risk management.
Key Pillars:
Key Pillars:
- Capital Adequacy: Minimum Capital Adequacy Ratio (CAR) of 10% in Bangladesh (Tier-1 minimum 6%)
- Leverage Ratio: Minimum 3% to limit excessive borrowing
- Liquidity Requirements: LCR (Liquidity Coverage Ratio) and NSFR (Net Stable Funding Ratio) ensure banks hold enough liquid assets
- Capital Conservation Buffer: Additional 2.5% buffer above minimum CAR
💡 Viva Tip
Know the difference between Tier-1 (core) and Tier-2 (supplementary) capital. Core capital = paid-up capital + retained earnings.
13
What is mobile banking? Name some mobile banking services in Bangladesh.
Digital Banking▼Mobile Banking (Mobile Financial Services — MFS) allows customers to perform financial transactions via mobile phones without visiting a bank branch.
Major MFS providers in Bangladesh:
Major MFS providers in Bangladesh:
- bKash: Largest MFS — subsidiary of BRAC Bank
- Nagad: Bangladesh Post Office digital financial service
- Rocket: DBBL's mobile banking service
- Upay, SureCash, mCash: Other licensed operators
💡 Viva Tip
Mention the daily and monthly transaction limits set by Bangladesh Bank and discuss financial inclusion impact.
14
What is the difference between Internet Banking and Mobile Banking?
Digital Banking▼Internet Banking: Full banking services accessed via web browser on computer/smartphone. Requires bank account, provides comprehensive features (fund transfer, bill pay, statements, L/C monitoring, fixed deposits). Uses userID/password + OTP authentication.
Mobile Banking (MFS): Basic financial services via mobile phone (USSD/app-based). May not require a traditional bank account. Simpler interface, works on feature phones. Uses PIN-based authentication. Focused on cash-in/cash-out, P2P transfers, and bill payments.
Key differences: Internet banking is account-based with full features; MFS is wallet-based with simpler transactions. MFS reaches the unbanked population more effectively.
Mobile Banking (MFS): Basic financial services via mobile phone (USSD/app-based). May not require a traditional bank account. Simpler interface, works on feature phones. Uses PIN-based authentication. Focused on cash-in/cash-out, P2P transfers, and bill payments.
Key differences: Internet banking is account-based with full features; MFS is wallet-based with simpler transactions. MFS reaches the unbanked population more effectively.
💡 Viva Tip
Discuss the trend toward digital banks — Bangladesh Bank issued guidelines for digital bank licensing in 2023.
15
Why do you want to work in the banking sector?
Fundamentals▼A strong answer should cover:
- Personal interest: "I'm passionate about financial services and enjoy analytical work involving numbers and risk assessment"
- Industry growth: "Bangladesh's banking sector is rapidly evolving with digital transformation, creating exciting opportunities"
- Career stability: "Banking offers structured career progression, professional development, and competitive compensation"
- Social impact: "Banks play a crucial role in economic development, financial inclusion, and supporting businesses"
- Skill match: Connect your education (BBA/MBA in Finance) or specific skills to banking requirements
💡 Viva Tip
Be specific about the bank you're interviewing for — mention their recent achievements, CSR activities, or digital initiatives to show genuine interest.